“The Fed may be worried about something else. By sitting on interest rates, it is distorting every business and investment decision. If mispriced debt was the root cause of the narrowly-averted destruction of global finance, the Fed is well on its way to setting the stage for some distant (let us hope) Act II. In the meantime, ultra-low interest rates have lit a fire under the stock and debt markets.”
So he is saying that the Fed is goosing the markets in the short term, and building up more problems for the long term. Since the WSJ wouldn’t have published a negative article from him, he focused on the short term part of the story. But pay attention to the whole story Jim Grant tells.
